Stocks finished trading Thursday with the Dow Jones Industrial Average clinging to a small gain while the S&P 500 dropped and the Nasdaq plummeted. A positive June Consumer Price Index that showed inflation was easing did little to help, as investors rotated out of technology and into other sectors on the stock market today.
The Dow eked barely made it into the black with a gain of less than 0.1%, while the Nasdaq plummeted 2%. The S&P 500 split the difference and dropped 0.9%. Only a day before, the latter two indexes hit record highs and completed a seven-day winning streak with gains of more than 1%. But both those advances were wiped out with Thursday's losses.
Meanwhile, the small-cap Russell 2000 gapped up with a whopping 3.7% gain. The iShares Russell 2000 exchange traded fund nearly traced the index, jumping 3.6% and breaking out of a cup-with-handle base with a 209.77 buy point. Shares are in the 5% buy zone up to 220.26.
But another ETF related to tech, the Innovator IBD 50, reversed and ended up 0.6% lower on the stock market today. It dipped slightly below its 21-day line but remains above its 50-day moving average.
Volume was more than 23% higher on the Nasdaq and higher on the New York Stock Exchange vs. the same time Wednesday.
In bonds, the 10-year Treasury yield dropped seven basis points to 4.21%. And U.S. crude oil prices surged to $83.10 a barrel.
Updated 3:13 p.m. PT
The Tech Sector That Was Hit The Hardest
As investors rotated out of tech stocks Thursday, the one group that perhaps felt the most pain was chip equipment makers. Despite expectations for record sales in 2024, many of the major chip-gear firms fell precipitously on the stock market today. Investor's Business Daily's Electronics-Semiconductor Equipment group dropped nearly 3%.
Leading the way was market cap leader ASML Holding, which mirrored the sector's loss by dropping nearly 3%. Applied Materials fared even worse, as it fell nearly 5%
Lam Research plunged more than 5% while KLA dropped nearly 4%. And Onto Innovation, which was about to move into a buy zone out of a flat base, dropped 4%.
Companies atop IBD's Tech Leaders list also fared poorly. All but one of the top 14 stocks on the list fell, and dropped somewhere between 1% and 6%, including artificial intelligence behemoth Nvidia. Nvidia dropped 4% in afternoon action. An IBD 50 and Leaderboard stock, Nvidia retreated nearly 3% after three straight days of climbing.
Among the other top tech stocks that plunged were recent IPO darling Arm Holdings, which was off nearly 6%. But biotech ADMA Biologics was up 2.2% and near record highs.
Updated 1:43 p.m. ET
Several Dozen Hit New Highs, But Very Few Techs
The market's transformation was illustrated Thursday by the types of stocks hitting new highs. IBD's MarketSurge shows 110 stocks on the site's New Highs list, but very few were traditional tech stocks. Many were heretofore unheralded names that suddenly drew the attention of investors looking to make a change.
Miners were particularly prosperous as Agnico Eagle Mines powered higher in its buy zone, and nearly pushed through it after breaking out on Wednesday. Alamos Gold and Wheaton Precious Metals also joined the party, as both worked their way into buy zones Thursday out of cup bases.
Bank stocks were another sector making a push. Ameris Bancorp barged through its buy zone and was extended as of Thursday. UMB Financial worked its way into a buy zone out of a flat base that lasted 70 days. Another was Third Coast Bancshares, breaking out of a cup base.
Usually staid industrial players also felt the love. Utility NiSource broke out of a flat base, while packing company UFP Technologies climbed to a new high, extending gains from a 268.34 entry.
Stock Market Today: Techs That Did Reach New Highs
Of the few tech firms reaching new highs, Vertex, a financial software company, managed to climb even higher past its buy zone. Gaming software maker Electronic Arts made a similar move, but the two were virtually alone in the traditional tech sector.
Biotech stocks and medical products makers were slightly more plentiful on the list as Regeneron Pharmaceuticals touched a new watermark. The same was true for Vertex Pharmaceuticals, which is unrelated to the financial software maker.
Also reaching a new high was Lantheus Holdings, which rocketed around 17% in heavy volume Thursday on top of Wednesday's 36.7% pop. The stock catapulted on news that Medicare proposed increasing the reimbursement rate for diagnostic radiopharmaceuticals, where Lantheus specializes.
Shares reached a new high on the stock market today. Lantheus develops and manufactures diagnostic and therapeutic products to diagnose and treat diseases such as cancer and heart disease.
Updated 12:10 p.m. ET
Homebuilders Also Prove Attractive
Another sector that prospered was homebuilder stocks. KB Home, PulteGroup, Toll Brothers, D.R. Horton and NVR all bolted 5% to 8% higher on the stock market today.
The SPDR S&P Homebuilders ETF also made a strong gain of nearly 6%. The fund reclaimed its 50-day line on Thursday's move. And shares are on track for their largest increase since Nov. 14, 2023, when they rose 5.88%, according to Dow Jones Market Data.
Retail stocks also had newfound interest with Urban Outfitters powering up more than 6%. The apparel retail stock tapped the 47.29 buy point of an irregular base before retracing.
Stock Market Today: Tech Stocks Take It On The Chin
Other tech stocks taking it on the chin included Facebook-parent Meta Platforms, down nearly 4% and Google-parent Alphabet, which fell nearly 3%.
Microsoft dropped nearly 3% while Apple pulled back nearly 2% after reaching an all-time high on Wednesday, following a rally of seven straight days. Apple was the first stock to top a market capitalization of $3.5 trillion, as noted in Wednesday's The Big Picture column.
And key chipmakers Advanced Micro Devices and Taiwan Semiconductor Manufacturing also dropped more than 3%. Further, Intel gave back nearly 4%.
Meanwhile, Magnificent Seven stock Tesla, made a drastic reversal and plunged more than 7%. On Wednesday, the electric-vehicle giant completed its 11th straight day of gains.
Updated 10:45 a.m. ET
June CPI Reading Shows Cooling Inflation
The Labor Department's June Consumer Price Index dropped 0.1%, reversing from an expected increase of 0.1%. This marks the first monthly decline since May 2020.
Meanwhile, the June year-over-year reading rose 3.0%, lower than the 3.1% projected gain. The June month-over-month core number, which excludes the more volatile food and energy components, rose 0.1% vs. an estimated 0.2%. Lastly, the June core annual rate came in at 3.3%, lagging the 3.5% forecast.
The Labor Department also said initial jobless claims for the week ended July 6, were 222,000. That came in lower than the 239,000 estimate and below the revised 239,000 from the prior week.
Nasdaq Tumbles As Small Caps Soar In Big Market Shift; JPMorgan On Tap
Stock Market Today: Airline Stocks Plunge
Delta Air Lines dropped more than 6% in huge volume after the company reported lower-than-expected second-quarter earnings and higher sales than views. Earnings dropped 11.9% vs. the prior year's quarter. But investors clued in on its third-quarter profit outlook which was below analyst projections.
The airline stock fell further below its 50-day moving average and found support at its 200-day line. It also dropped below the bottom of the flat base it was forming. Delta stock is on track for its largest decrease since Jan. 12, when it fell 9%, according to Dow Jones Market Data.
United Airlines sank nearly 5% in sympathy with rival Delta Air Lines. United's stock chart looks similar to Delta's as the stock sank deeper below its 50-day line and stopped short of its 200-day line. United reports its second-quarter earnings on Wednesday after the market close.
American Airlines Group plunged more than 5%. The stock has the weakest-looking chart of the big three airlines and is down more than 22% so far this year. It plunged 13.5% on May 29, after the company lowered its second-quarter earnings estimates.
Stock Movers: WD-40 Glides Higher
WD-40 jumped more than 3% on the stock market today after the specialty lubricant maker topped fiscal third-quarter profit and revenue estimates.
Costco Wholesale reversed 3% lower following news it will raise its annual membership fee by $5 to $65 a year. This is its first membership fee hike since 2017. The warehouse wholesale club stock is extended from a cup base with a 787.08 buy point.
PepsiCo tumbled nearly 1% after the beverage and packaged food company beat second-quarter adjusted earnings but missed revenue estimates. Shares are below their 200-day line and have lost 5% so far this year.
Pfizer trimmed larger gains to 0.4% in recent trades on the stock market today. The stock got a lift on news the drugmaker said it selected a once-daily pill to move forward as a potential weight-loss drug. The stock retook its 200-day line on the move but has underperformed of late and has a dismal Relative Strength Rating of 28.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
